Editing Crypto AG (section)

===Exposure and Security Breaches===
(1970s–1990s). Suspicions about Crypto AG’s security emerged early, with several breaches threatening exposure:

1970s Leaks: In 1975, former CIA operative Philip Agee’s book Inside the Company hinted at NSA exploitation of Hagelin machines. In 1982, James Bamford’s The Puzzle Palace revealed Friedman’s correspondence with Hagelin, donated to the George Marshall Foundation in 1969. The NSA reclassified these in 1983, releasing censored versions in 2015.

1977 Frutiger Incident: Crypto engineer Peter Frutiger, suspecting BND ties, fixed vulnerabilities in Syria’s Crypto devices without authorization, making them unreadable to the NSA. CEO Heinz Wagner fired him, prompting NSA criticism for not silencing him discreetly. Frutiger later claimed in a 2020 NZZ am Sonntag interview that he cooperated with the CIA and NSA but left due to ethical concerns.

1986 La Belle Bombing: President Ronald Reagan’s public claim of intercepting Libyan communications post-1986 Berlin discotheque bombing raised suspicions. Argentina, suspecting NSA decryption, was reassured by a CIA bluff that only older CAG 500 machines were vulnerable, continuing purchases.

1992 Bühler Arrest: Iranian intelligence arrested Crypto salesman Hans Bühler in 1992, suspecting backdoors. Unaware of the CIA/BND ownership, Bühler was detained for nine months, released after a $1 million BND-paid ransom. His subsequent media statements, alongside another engineer’s suspicions, sparked a “storm of publicity,” per the CIA history. The CIA sued Bühler in 1995 for breaching a gag order, settling out of court to silence him.

1995 Baltimore Sun Report: Scott Shane and Tom Bowman’s Baltimore Sun articles detailed NSA-Crypto ties, citing Bühler and archival evidence, prompting several countries to halt purchases, though Iran continued buying which indicates they were under the control of the CIA at this point.